MTI victims are getting messed over, and SA authorities are doing nothing.
Now, here’s an update on the Mirror Trading liquidation proceedings in South Africa:
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Every MTI victim claim has been turned down.
JNX Online, a corporation owned by MTI founder Johann Steynberg, filed the lone claim that was authorized.
South African officials are still doing nothing.
The shitshow goes on…
I’m not going to claim to be an authority on South African law. I’m aware with the United States, where a Receiver/Trustee is appointed, scammers are steamrolled, and victims with valid claims eventually receive their money back.
South Africa, on the other hand, has a convoluted liquidation setup. This procedure is carried out independently of South African authorities.
MoneyWeb stated that the second meeting of Mirror Trade International creditors took place on February 4th.
Following the conclusion of the meeting,
All investor claims were dismissed because they were ‘illegible.’
The lone claim approved by Cape High Court Master Zukile Mabusela was from the trustee of JNX Online, a firm founded by MTI founder Johann Steynberg and his wife Nerina.
Steynberg used JNX Online to buy and sell bitcoin (BTC) as well as pay creditors and MTI employees.
This implies that, for some strange reason, MTI staff will be compensated before the victims of the Ponzi scheme.
Employees of MTI are listed below for your convenience:
The issue is that the majority, if not all, of MTI’s employees are also the scheme’s top earners. At the very least, they are related to them.
To that purpose, liquidators released the following statement in November:
It is unlikely that any employee may still file a claim for unpaid wages against MTI.
But, sure. Anyone involved in making liquidation decisions does not appear to be concerned about Johan Steynberg’s company being the only legal claim.
Clynton Marks, MTI’s highest earner and probable co-owner (right with another putative co-owner and wife, Cheri Marks), had his personal claim rejected.
Clynton Marks, a 50% shareholder in MTI and a creditor in the amount of R135.6 million in bitcoin loaned to MTI, had his claim dismissed as well.
His attorney, John Suttner SC, questioned why the claim was denied because it was not a claim for a return on investment. Suttner described the claim as “clearly liquidated.”
The Master responded that Marks’ accusation was unsubstantiated.
I’m not shocked Marks couldn’t prove ownership of $8.9 million in stolen investor monies. I’m not sure why the claim was entertained in the first place.
When it came to MTI’s victims, getting screwed over evoked a rather expected reaction.
Creditors are allegedly outraged that these resolutions give the liquidators broad rights to conduct enquiries and do whatever is necessary to locate lost bitcoin, believing that this is a blank check to incur fees at their expense.
Hendrik van Staden, who represented 920 creditors totaling R229.8 million, told the Master he was dissatisfied with the rejection of the claims.
When Sybrand Tintinger, the liquidators’ lawyer, moved to adjourn the meeting, Chris Kriel, representing around 12 000 investors, expressed his disappointment that the liquidators’ statement was null and void.
“You [the Master] stated that these liquidators must establish a burden of proof for this liquidation.
“The liquidators are unpleasant,” he said.
The liquidators had access to the back office computer systems and could have reconstructed who had invested bitcoin and how much, but this did not occur.
“It is arrogant to reject thousands of these claims on a technicality from the liquidators when that technicality was not communicated to the investors.”
“I’m going to publish this meeting all over the world and inform people how these liquidators are treating them,” Kriel added.
Investors are harmed when claims are rejected because they are denied the opportunity to vote on any resolutions proposed by the liquidators.
Again, I’m not familiar with South African law, but it appears that liquidators established claim criteria without informing anyone.
Then, in good faith and with the assistance of attorneys, MTI victims filed claims.
The liquidators subsequently rejected every claim that was submitted based on their secret criteria.
And all of this appears to be legal and a standard component of South Africa’s post-scam liquidation process.
So, what comes next?
Several creditors are apparently planning to review the liquidation for what they perceive to be numerous irregularities, such as the blanket denial of claims, which deprived creditors the chance to vote on resolutions that allow the liquidators to build up expenditures at their expense.
There was a lot of nothing. Meanwhile, MTI’s liquidators have around 8000 BTC. That is now worth $354.7 million.
We don’t know if they’ve actually retrieved that amount; all we know is that they know where it is. That was almost seven months ago…
Where are the authorities in South Africa in all of this?
They are still doing nothing. Mirror Trading International’s criminal inquiry was ended by the FSCA in January 2021.
There have been no more updates eleven months after the study was completed.
There was speculation of a $6.9 million penalties in July 2021, but that didn’t happen. Perhaps the FSCA filed a claim and had it denied by liquidators.
Johann Steynberg (right) was arrested in Brazil last month, halfway around the world.
There have been no more developments. We still don’t know if Steynberg will be extradited to the United States or South Africa.
Personally, I believe that if Steynberg is to face justice, he will only do so if he is extradited to the United States.
If he is extradited to South Africa, I believe Steynberg will be released and end up with the majority of the seized funds.
The case will not be resolved. Victims will be asked to forget their losses and move on with their lives.
The true tragedy of the MTI incident was documented in the Zoom meeting’s comments area.
“What happened to the 8,000 BTC that the liquidators said they discovered?” one commentator inquired
“If the liquidators have done nothing in the last year, we can presume they will not be charging any fees to the members,” another stated.
“What about the tens of thousands of people whose lives have been completely destroyed?” another piece of writing
“There are people committing suicide and people living in garages.”
Hopefully, the next MTI liquidation update won’t be too close. This is far too depressing to write about.
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